Pertamina files new evidence to supreme court against KBC

Lawyers of state oil and gas firm Pertamina have filed new evidence to the supreme court to counter independent power producer Karaha Bodas Company (KBC) which had appealed to that court its case against the Indonesian firm, Pertamina?s legal officer Simson Pandjaitan said on Tuesday.

Simson said that the new evidence, submitted to the supreme court late last month, was related to insurance, tax and oversight expenditure. He declined to explain, however.

Sources said that KBC had violated existing tax laws because the amount it had paid to the tax office had not been commensurate with the value of its assets. Further, KBC had in fact received insurance payment for the suspension of its power project in Karaha Bodas district in West Java, sources said.

Simson said on Tuesday KBC, which is principally backed by U.S. companies FPL Energy and Caithness Energy, had on Sept. 9 appealed its case to the supreme court.

The dispute between Pertamina and KBC centers on KBC entering into contracts with Pertamina and state electricity company PLN in 1994 to develop a geothermal power plant in Karaha Bodas.

The Indonesian government cancelled the project as part of the retrenchment program to cope with the impact of the crisis which hit Indonesia in 1997. KBC, which claimed to have invested some US$100 million in the geothermal project, sued Pertamina in Switzerland-based arbitration panel. .

The arbitration panel ordered Pertamina to pay KBC $261 million for the project suspension. But, Pertamina refused to do so and reported its case to the Central Jakarta district court which annulled the arbitration panel?s decision. (godang)